The debate over legal sports betting in California has taken a significant turn with the proposed Sports Wagering Regulation and Tribal Gaming Protection Act, which would revise the state’s constitution. Proposed back in October, the Act is designed to pave the way for legally sanctioned betting, amending Article IV, section 19, and granting tribal groups the exclusive rights to operate both retail and online betting platforms.
The initial draft of this legislation detailed several stipulations: tribes would put 15% of the adjusted sports betting gross gaming revenue into a tribal wagering revenue sharing trust fund, contribute 10% to a fund dedicated to homelessness and mental health in California, and establish partnerships with sports betting operators that would require dual approval from the Tribal Gaming Agency and the state gaming agency. While the concept earned a measure of support, stakeholders raised concerns about specific aspects of the proposal.
In response to feedback from tribal leaders, out-of-state operators, regulators, and other interested parties, the group known as Eagle1 has introduced a series of amendments. Among these changes, a new commencement date for sports wagering has been set to July 1, 2025, moved up from the initial proposal of September 1, 2025.
Financial incentives for the tribes have also improved under the new amendments: with current conditions promising around $1.0 million in annual revenue for the tribes, the revised measures predict 15 to 20 times more income. The contribution to the tribal wagering revenue sharing trust fund has additionally seen a bump from 15% to 25%.
Another notable adjustment is the elimination of the requirement for in-person online gambling registration for individuals residing beyond a 10-mile radius of a casino, which will no longer be necessary after a span of two years. The process for tribes to create their affiliate operations has been simplified, and a plan has been put forth to tax promotional credits after a period of five years.
Eagle1 has also declared that tribes are no longer on the hook financially to aid in the proposition’s passage. The full expense, including the costs of a signature campaign estimated at $25 million and a public vote campaign projected to run into the hundreds of millions, will be absorbed by Eagle1.
Eagle1 partner Kasey Thompson, who played a significant role in crafting the proposition, expressed optimism that the changes would garner more tribal support, deeming it essential for the ballot’s success. Thompson highlighted that the revamped proposal has evolved with input from tribes and regulators to align with the current legal landscape. “We took a proposal that had the support of more than 70 tribes and was one of the most tribal-focused propositions ever, made amendments based on tribal and regulator feedback and updated it for today’s legal landscape,” Thompson stated.
Reeve Collins, co-founder and CEO of Pala Interactive, also endorsed the modifications, noting that impediments have been removed and a proposition has been formed which is inclusive of all parties— tribals, land-based casinos, regulators, out-of-state operators, and the populace of California. Collins emphasized the forward-thinking and tribal-centric nature of the proposal, which he believes sets the stage for sports betting in California.
With the 2024 California election on the horizon, Eagle1 is steadfast in its collaboration with tribal leaders to obtain the necessary support for getting the ballot proposition to voters in hopes of passing it into law. Originally, Pala Interactive was given 180 days to accumulate the required signatures via random sampling, with a deadline falling on April 23, 2024, which poses a tight schedule. A minimum of 874,641 signatures will need to be collected and at least 500 verified for the ballot to advance for voter consideration.
This initiative comes on the heels of rejected sports betting proposals in the November 2022 election. Despite this setback and the previous recommendation from California Democrats against betting proposals, proponents of legal sports gambling are pressing forward, undeterred. It remains to be seen if Californians will welcome the chance to legalize sports betting, potentially making the Golden State the largest legal sports betting market in the United States.
